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6 years of options trading taught me this…
•the hole in the hull: why my best year was the one i spent looking for my flaw
last year i made ridiculous life changing money. the kind of year that makes you feel bulletproof
and that's exactly the problem!
this year i didn't try to top it. i spent it hunting for the one flaw that could sink the whole ship
•the number that lied to me
3,151 trades this year. 2,818 winners. that's an 89% win rate
on paper that's an A student. size your bets evenly, win 9 out of 10 and it looks like a recipe for success
but a win rate isn't a p&l. the ratio means nothing if a black swan shows up on the one day i'm carrying too much risk. one bad trade sized wrong can erase hundreds of good ones
•the flaw wasn't emotional, it was systemic
a friend who builds algo trading bots told me to put my strategy into code because code has no emotions. he's right about code. but my problem wasn't emotion
i shared my trades with my wife and parents in real time. the wins got the spotlight. the losers showed up on the statement a week later, quietly, buried in a good month
without realizing it i built a system that rewarded not losing instead of managing risk. i wanted to stay a 90% student so badly that i wouldn't close a trade while it was red
the frustrating part is that it usually worked. a lot of red trades came back because my direction was right. but the vast majority of my real losses weren't small cuts. they were positions i let ride all the way to zero
•learning to sit on my hands
when tsla fell to 300 after q2 earnings, i stepped away for 2 months. no forcing trades, no revenge. i waited for it to recover and then went back to selling covered calls
that break showed me something important. i still had the patience to sit on my hands and pick my spots. discipline isn't only about what you do, it's about what you're willing not to do
•becoming a better loser
this week a tsla put went bad. the old me lets it expire worthless and tells himself it might come back
the new me sold it for 3 cents
3 cents sounds like nothing. it isn't about the money. it's about breaking the habit of waiting for zero. it's the first rep of learning to take the L early once it's clear i'm wrong
i still closed that day up about huge. one bad trade, managed instead of ignored, and the day was still green
•why i'm not coding it yet
i could build an algo or teach an ai how i trade. but if i automate my strategy before i fix this flaw, i'm just automating the flaw
this lesson has to be learned in my own process first. then the code can carry it
•stay the student
success is the most dangerous teacher because it hides the cracks. the better your results, the easier it is to get cocky and stop looking
so here's my takeaway
- your win rate is not your scoreboard, your risk is
- study your losses harder than your wins
- sitting out is a position
- cut the trade when you know you're wrong, not when it hits zero
- be a student more than a teacher, especially after a great year
i'm still learning. always will be 🫶🏻 and thanks grok @bot for helping share my learnings in an efficient manner
•the hole in the hull: why my best year was the one i spent looking for my flaw
last year i made ridiculous life changing money. the kind of year that makes you feel bulletproof
and that's exactly the problem!
this year i didn't try to top it. i spent it hunting for the one flaw that could sink the whole ship
•the number that lied to me
3,151 trades this year. 2,818 winners. that's an 89% win rate
on paper that's an A student. size your bets evenly, win 9 out of 10 and it looks like a recipe for success
but a win rate isn't a p&l. the ratio means nothing if a black swan shows up on the one day i'm carrying too much risk. one bad trade sized wrong can erase hundreds of good ones
•the flaw wasn't emotional, it was systemic
a friend who builds algo trading bots told me to put my strategy into code because code has no emotions. he's right about code. but my problem wasn't emotion
i shared my trades with my wife and parents in real time. the wins got the spotlight. the losers showed up on the statement a week later, quietly, buried in a good month
without realizing it i built a system that rewarded not losing instead of managing risk. i wanted to stay a 90% student so badly that i wouldn't close a trade while it was red
the frustrating part is that it usually worked. a lot of red trades came back because my direction was right. but the vast majority of my real losses weren't small cuts. they were positions i let ride all the way to zero
•learning to sit on my hands
when tsla fell to 300 after q2 earnings, i stepped away for 2 months. no forcing trades, no revenge. i waited for it to recover and then went back to selling covered calls
that break showed me something important. i still had the patience to sit on my hands and pick my spots. discipline isn't only about what you do, it's about what you're willing not to do
•becoming a better loser
this week a tsla put went bad. the old me lets it expire worthless and tells himself it might come back
the new me sold it for 3 cents
3 cents sounds like nothing. it isn't about the money. it's about breaking the habit of waiting for zero. it's the first rep of learning to take the L early once it's clear i'm wrong
i still closed that day up about huge. one bad trade, managed instead of ignored, and the day was still green
•why i'm not coding it yet
i could build an algo or teach an ai how i trade. but if i automate my strategy before i fix this flaw, i'm just automating the flaw
this lesson has to be learned in my own process first. then the code can carry it
•stay the student
success is the most dangerous teacher because it hides the cracks. the better your results, the easier it is to get cocky and stop looking
so here's my takeaway
- your win rate is not your scoreboard, your risk is
- study your losses harder than your wins
- sitting out is a position
- cut the trade when you know you're wrong, not when it hits zero
- be a student more than a teacher, especially after a great year
i'm still learning. always will be 🫶🏻 and thanks grok @bot for helping share my learnings in an efficient manner
